According to a report published by Cointelegraph, The United States Federal Reserve's instant payment system, FedNow, has added Dropp, a micropayments platform built on the distributed ledger technology (DLT) platform Hedera Hashgraph, to its FedNow Service Provider Showcase section. The section's purpose is to help financial institutions and businesses discover service providers that can facilitate the implementation of instant payment products using the FedNow Service.
According to the Federal Reserve, Dropp is a digital solution designed to enable merchants to accept payments at minimal costs. The company combines DLT and regulated banking technology to develop a payment system that reduces transaction fees for merchants.
Although the addition of Dropp to the showcase might suggest that the Federal Reserve is becoming more receptive to DLTs, FedNow clarified on its website that the materials are only for the convenience of potential participants. Furthermore, the Federal Reserve Financial Services (FRFS) does not endorse or support any showcased providers, and the inclusion or exclusion of a provider should not imply a recommendation or endorsement.
Some members of the crypto community have expressed concerns about the potential for corruption in financial systems, as DLTs gain traction within these institutions. Earlier this year, other blockchain networks announced their connection to the FedNow service. However, they were subsequently removed from the site.
The inclusion of Dropp, a DLT-powered payments system, in FedNow's showcase highlights the evolving dynamics between traditional financial systems and emerging technologies. While the Federal Reserve does not endorse Dropp or any other showcased providers, its willingness to feature DLT-powered solutions indicates a growing openness to considering alternative payment technologies.
